Correlation Between Inspur Software and Gansu Jiu
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By analyzing existing cross correlation between Inspur Software Co and Gansu Jiu Steel, you can compare the effects of market volatilities on Inspur Software and Gansu Jiu and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Inspur Software with a short position of Gansu Jiu. Check out your portfolio center. Please also check ongoing floating volatility patterns of Inspur Software and Gansu Jiu.
Diversification Opportunities for Inspur Software and Gansu Jiu
0.75 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Inspur and Gansu is 0.75. Overlapping area represents the amount of risk that can be diversified away by holding Inspur Software Co and Gansu Jiu Steel in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gansu Jiu Steel and Inspur Software is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Inspur Software Co are associated (or correlated) with Gansu Jiu. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gansu Jiu Steel has no effect on the direction of Inspur Software i.e., Inspur Software and Gansu Jiu go up and down completely randomly.
Pair Corralation between Inspur Software and Gansu Jiu
Assuming the 90 days trading horizon Inspur Software Co is expected to under-perform the Gansu Jiu. But the stock apears to be less risky and, when comparing its historical volatility, Inspur Software Co is 1.12 times less risky than Gansu Jiu. The stock trades about -0.01 of its potential returns per unit of risk. The Gansu Jiu Steel is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 139.00 in Gansu Jiu Steel on October 22, 2024 and sell it today you would earn a total of 11.00 from holding Gansu Jiu Steel or generate 7.91% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Significant |
Accuracy | 100.0% |
Values | Daily Returns |
Inspur Software Co vs. Gansu Jiu Steel
Performance |
Timeline |
Inspur Software |
Gansu Jiu Steel |
Inspur Software and Gansu Jiu Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Inspur Software and Gansu Jiu
The main advantage of trading using opposite Inspur Software and Gansu Jiu positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Inspur Software position performs unexpectedly, Gansu Jiu can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Gansu Jiu will offset losses from the drop in Gansu Jiu's long position.Inspur Software vs. HanS Laser Tech | Inspur Software vs. Bloomage Biotechnology Corp | Inspur Software vs. Jiujiang Shanshui Technology | Inspur Software vs. Yili Chuanning Biotechnology |
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Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Portfolio Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
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